These stocks yield as much as 9.9% and have a lower cost to entry than investing in a rental property.
Some recent retirees struggle once they stop collecting a regular paycheck, and instead start living off their investment portfolio. Unavoidable expenses coupled with day-to-day market volatility can sometimes result in difficult choices for these folks, like whether to sell a good stock at a very bad time simply to pay the bills. However, there is a better way to provide for your expenses in retirement instead of slowly bleeding down your savings. This strategy involves regular income generation from dividend stocks, bonds and other assets. One increasingly popular choice for income investment is monthly dividend stocks because they offer cash flow every 30 days instead of every three months as is typical on Wall Street. There’s risk here, as with all investments, but the following monthly dividend stocks could be worth a look in income-oriented portfolios.
Agree Realty Corp. (ticker: ADC)
Agree is a publicly traded real estate investment trust, or REIT. If you’re unfamiliar, this special class of corporation is granted preferential tax treatment to facilitate its capital-intensive operations. And in exchange, all REITs must deliver 90% of taxable income back to shareholders. Agree is primarily engaged in “net leased” retail properties, meaning tenants pay for the upkeep and taxes while ADC just cashes the rent checks. Its diverse portfolio spans 45 states and comprises 21 million square feet of gross leasable property, with tenants such as Walmart Inc. (WMT) and Home Depot Inc. (HD). That makes for a stable operation that can support regular monthly dividend payments to shareholders.
Dividend yield: 3.7%
Apple Hospitality REIT Inc. (APLE)
Apple Hospitality is another REIT, but one focused on a diverse portfolio of upscale hotel properties that span almost 90 different markets in 34 states. These properties are branded under the Marriott, Hilton and Hyatt nameplates and include locales such as Boca Raton, San Diego and New York City. With pent-up demand for travel in the wake of COVID-19, Apple has seen strong revenue lately and its stock has responded in kind. APLE shares are down just under 5% year to date, which is pretty darn good considering the S&P 500 is down about 18% in the same period.
Dividend yield: 5.4%
Cross Timbers Royalty Trust (CRT)
Cross Timbers Royalty Trust is the smallest stock on this list at just under $150 million in market capitalization. However, it is a monthly dividend stock in the energy space that’s worth a look because of its partnership model that slowly brings its energy reserves to market — and delivers the majority of the profit from those sales right back to shareholders. At the end of last year, CRT boasted 2.5 million barrels of oil and 14.3 billion cubic feet of natural gas underground, so there’s ample resources left to ensure continued payouts for a while. And with a generous yield among the largest on this list, this monthly dividend stock is worth a look despite its small size. Energy prices remain elevated in 2022 and chances are this small-cap stock will continue to provide big dividends in the near term.
Dividend yield: 8%
Gladstone Capital Corp. (GLAD)
Gladstone operates much like a venture capital fund or private equity firm, searching out profitable investments in other businesses and passing a piece of the profits on to shareholders. It is primarily focused on small opportunities, through investments ranging from $7 million to $30 million apiece. Its portfolio includes positions in restaurants, manufacturers, technology enterprises and others. The diversified debt portfolio helps to deliver consistent payouts every month that are roughly five times that of the typical S&P 500 stock.
Dividend yield: 8.3%
Horizon Technology Finance Corp. (HRZN)
If you want the stability of a monthly dividend stock that delivers consistent income but you also want the potential for growth, consider Horizon. As the name implies, this financial firm invests in high-tech and high-potential startups, including medical technology and green energy opportunities as well as traditional electronics and software. Though a rough environment has caused HRZN to drop about 20% this year, that’s not as bad as some other tech-focused opportunities and is similar to the rest of Wall Street. The generous monthly dividend is a good hedge against further declines, however, and the growth-oriented business could set investors up for growth if and when bluer skies return to Wall Street in the coming months.
Dividend yield: 9.9%
LTC Properties Inc. (LTC)
LTC is a monthly dividend stock focused on one of the most stable businesses out there — senior housing and skilled nursing facilities. These are recession-proof expenses as loved ones continue to pay for aging family members’ care in any economic environment, resulting in a highly reliable revenue stream for LTC. Thanks to this “risk-off” appeal, LTC stock has raced up more than 25% since Jan. 1 even as the rest of Wall Street has struggled in 2022. That’s not including the generous dividend, which has continued to roll in and add a big monthly payday on top of this share price return. If you want a regular payday with stability, this stock may be worth a look.
Dividend yield: 5.2%
6 best monthly dividend stocks to buy now:
— Agree Realty Corp. (ADC)
— Apple Hospitality REIT Inc. (APLE)
— Cross Timbers Royalty Trust (CRT)
— Gladstone Capital Corp. (GLAD)
— Horizon Technology Finance Corp. (HRZN)
— LTC Properties Inc. (LTC)
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Update 09/07/22: This story was published at an earlier date and has been updated with new information.